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How to Borrow

Borrowing UI

When selecting the "BORROW" tab from the main UI, all relevant market information and values for borrowers are displayed:

Collateral displays the collateral token of the market, while Borrow shows the token which can be borrowed. Borrow APY represents the current borrow rate.

The Available column shows the amount of assets left to borrow and Borrowed is the total amount currently borrowed.

Supplied shows the total amount of the borrowable token which has been supplied by users.

The Utilization (%) is the ratio of Borrowed to Supplied tokens, see here for more information.

Creating A New Loan

In order to create a loan and borrow tokens against collateral, a user first needs to choose a lending market. This can simply be done by clicking the desired market.

Having "Advanced Mode" activated when creating a loan allows the user to additionally select the number of bands for the loan and displays the corresponding liquidation range. If deactivated, the loan will be created with a default amount of 10 bands.

Advanced Mode can be toggled on the top right of the page.

Number of Bands (N)

A higher number of bands results in fewer losses when the loan is in soft-liquidation mode. The maximum number of bands is 50, while the minimum is 4.

Additionally, the UI shows the future borrow APY when the user's loan is created and the loan-to-value (LTV) ratio.

Advanced mode also enables an overview of the entire LLAMMA including important values such as lend or borrow APY, available amount to borrow, etc.

Down below, a section containing relevant contracts and the current parameters for the lending market is displayed.

  • Fee: The current exchange fee for swapping tokens in the AMM.
  • Admin Fee: The percentage of the total fee, which is awarded to veCRV holders. Currently, all fees go to liquidity providers in the AMM (which are the borrowers).
  • A: The amplification parameter A defines the density of liquidity and band size.
  • Loan Discount: The percentage used to discount the collateral for calculating the maximum borrowable amount when creating a loan.
  • Liquidation Discount: The percentage used to discount the collateral for calculating the recoverable value upon liquidation at the current market price.
  • Base Price: The base price is the price of the band number 0.
  • Oracle Price: The oracle price is the current price of the collateral as determined by the oracle. The oracle price is used to calculate the collateral's value and the loan's health.

Navigating to the "Your Details" tab displays all the user's loan details:1

Loan Management

Loan Management when in soft-liquidation mode

During soft-liquidation, users are unable to add or withdraw collateral. They can choose to either partially or fully repay their crvUSD debt to improve their health ratio or decide to self-liquidate their loan if their collateral composition contains sufficient crvUSD to cover the outstanding debt. If they opt for self-liquidation, the user's debt is fully repaid and the loan will be closed. Any residual amounts are then returned to the user.

Everything needed to manage a loan is available in the UI.

The "Manage Loan" tab has the following options:

  • Borrow more: Borrowing more assets, while adding additional collateral (not necessary).
  • Repay: Partially or fully repay debt.
  • Self-liquidate: Close their loan via self-liquidation.

The "Collateral" tab allows the adjustment of collateral:

  • Add collateral: Add more collateral to the loan.
  • Remove collateral: Remove collateral from the loan.

  1. This tab will only show up if a user has a loan and their wallet is connected to the site. ↩